Correlation Between Dave Busters and Life Time
Can any of the company-specific risk be diversified away by investing in both Dave Busters and Life Time at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Dave Busters and Life Time into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dave Busters Entertainment and Life Time Group, you can compare the effects of market volatilities on Dave Busters and Life Time and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Dave Busters with a short position of Life Time. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dave Busters and Life Time.
Diversification Opportunities for Dave Busters and Life Time
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Dave and Life is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Dave Busters Entertainment and Life Time Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Life Time Group and Dave Busters is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Dave Busters Entertainment are associated (or correlated) with Life Time. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Life Time Group has no effect on the direction of Dave Busters i.e., Dave Busters and Life Time go up and down completely randomly.
Pair Corralation between Dave Busters and Life Time
Given the investment horizon of 90 days Dave Busters Entertainment is expected to under-perform the Life Time. In addition to that, Dave Busters is 3.49 times more volatile than Life Time Group. It trades about -0.27 of its total potential returns per unit of risk. Life Time Group is currently generating about -0.2 per unit of volatility. If you would invest 2,483 in Life Time Group on September 12, 2024 and sell it today you would lose (157.00) from holding Life Time Group or give up 6.32% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dave Busters Entertainment vs. Life Time Group
Performance |
| Timeline |
| Dave Busters Enterta |
| Life Time Group |
Dave Busters and Life Time Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dave Busters and Life Time
The main advantage of trading using opposite Dave Busters and Life Time positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dave Busters position performs unexpectedly, Life Time can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Life Time will offset losses from the drop in Life Time's long position.| Dave Busters vs. Imax Corp | Dave Busters vs. Marcus | Dave Busters vs. AMC Networks | Dave Busters vs. Cinemark Holdings |
| Life Time vs. Planet Fitness | Life Time vs. Bowlero Corp | Life Time vs. JAKKS Pacific | Life Time vs. Acushnet Holdings Corp |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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